Reliance Industries Q4 Review: Target Price Lowered By Motilal Oswal After Muted Performance
Muted Q4 prompts target cut, long-term Reliance outlook remains positive.
Reliance Industries came under investor focus after its fourth-quarter results fell short of market expectations, prompting Motilal Oswal Financial Services to lower its target price on the stock. The brokerage cited a weaker-than-anticipated performance in key business segments, particularly the oil-to-chemicals division, as a primary reason for the revision. Despite the downgrade, analysts retained a broadly positive stance on the company’s long-term fundamentals and growth prospects.
The company reported a decline in consolidated net profit for the quarter, even as revenues remained relatively stable. The drop in earnings was largely attributed to margin pressure in the energy business, which continues to be sensitive to global crude price fluctuations and demand cycles. This subdued performance weighed on overall profitability, offsetting gains made in other divisions and leading to a cautious near-term outlook among market participants.
Motilal Oswal noted that while the energy segment underperformed, the company’s consumer-facing businesses — particularly telecom and retail — provided a degree of resilience. Reliance Jio continued to post steady growth, supported by an expanding subscriber base and improved average revenue per user. Meanwhile, the retail arm maintained its expansion trajectory, although competitive pressures and cost structures kept margins in check during the quarter.
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Following the earnings announcement, investor sentiment remained mixed, with the stock witnessing some pressure in the market. Analysts across brokerages highlighted concerns over near-term earnings visibility, especially in the oil-to-chemicals segment. However, many also pointed out that the diversified business model of Reliance Industries helps cushion volatility in any one segment, offering a degree of stability over time.
Looking ahead, Motilal Oswal maintained that the company’s long-term outlook remains intact, driven by structural growth in its digital and retail businesses. Potential triggers such as tariff hikes in telecom, continued retail expansion, and strategic value unlocking opportunities are expected to support future performance. While the near-term may remain challenging, the brokerage believes the company is well-positioned to deliver sustainable growth over the coming years.
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